Tax Commission News Release
You may owe use tax on internet, other untaxed purchases
BOISE, IDAHO — March 30, 2017 — If you’re gathering information to file your 2016 Idaho individual income tax return, don’t forget those untaxed purchases you made last year. If you didn’t pay sales tax when you bought the merchandise, you owe a 6 percent use tax if the goods were stored or used in Idaho.
For example, when you buy goods on the internet, by telephone, or from a mail-order catalog, sellers might not charge sales tax if they’re not Idaho retailers. As the shopper, you’re responsible for paying tax directly to the Idaho State Tax Commission if the goods are shipped to you in Idaho. And if you buy merchandise in a state where no sales tax is charged – such as Oregon or Montana – you owe use tax if you bring the goods into Idaho.
Check your invoices or receipts to see whether sales tax was collected on the following types of purchases:
- Internet purchases (including digital music, movies, books, and games)
- Magazine subscriptions
- Book and music club items
- Catalog and phone purchases
- Purchases in a state where no sales tax is charged (e.g., Oregon, Montana)
If sales tax wasn’t collected, Idaho makes it easy for you to pay your use tax when you file your annual income tax return, which is due by April 18 this year. Simply total your untaxed purchases, multiply that total by .06, and enter that amount (rounded to the nearest dollar) on the appropriate line of your income tax return (see below):
- Full-year residents who file Form 40 (Idaho Individual Income Tax Return) can pay their use tax on line 28 of the tax return.
- Part-year residents can pay use tax on line 48 of Form 43 (Idaho Part-Year Resident & Nonresident Income Tax Return).
- You can also fill out Form 850-U (Idaho Self-Assessed Use Tax Worksheet and Return), available at tax.idaho.gov, and pay use tax at any time during the year.
“The use tax has been in effect since 1965. It’s an important tool to make sure that Idaho retailers can compete fairly with out-of-state companies that don’t collect sales tax,” said Renee Eymann, the Idaho State Tax Commission’s public information officer.
Sales and use taxes help fund state and local services throughout Idaho, and the use tax ensures that all consumers in the state contribute equitably to the funding of these services, whether they choose to make purchases in Idaho, online, or outside the state. Last year, more than 11,000 Idahoans paid use tax totaling nearly $800,000 with their 2015 income tax returns.
For more information about use tax, visit the Tax Commission’s Online, Catalog, and Out-of-state Shopping webpage and watch a Use Tax video at tax.idaho.gov. You can also call the Tax Commission at (208) 334-7660 in the Boise area or toll-free at (800) 972-7660.
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